Amazon (AMZN)
Consumer Discretionary · $2.89T market cap · SEC CIK 0001018724
ahead of 50% of the S&P 500 · #23 of 48 in Consumer Discretionary
Next reports on Feb 3, 2027, after the close, with analysts expecting $2.45 in earnings per share.
52-week range $196.00 to $287.20. 6% below its 52-week high and 38% above its low.
The case for AMZN
- Cheap for its growth: 21.4× earnings, where 19% a year of growth would justify about 36×.
- Earns 27% back on shareholder equity.
- Holds more cash ($86.8B) than long-term debt ($65.6B).
- Revenue growing 15.3% year over year.
- Earnings per share up 74.8%.
- Has compounded revenue at 13.2% a year over five years.
The case against
- Operating profit covers its interest bill only 0.6 times.
- Only 10% of FY2025's $77.7B profit arrived as free cash.
- Current liabilities exceed current assets (ratio 0.99).
- Swings harder than the market (beta 1.54).
- Free cash flow is only 0.3% of its market value, a thin cash return for the price.
What the score is made of
Each factor is half a curve over reported figures and half a rank among the other Consumer Discretionary companies (momentum is judged against fixed thresholds only), and the five are blended by weight. The score is where that blend places it in the S&P 500. It describes the last filing and the current price. It is not a forecast.
| Valuewhat you pay for the earnings and cash, against the growth you get | 34 |
|---|---|
| Growthhow fast revenue and earnings are moving, this year and over five | 82 |
| Profitabilityhow much of the revenue becomes profit, and how much of that is cash | 58 |
| Momentumhow the price has behaved lately | 60 |
| Stabilityhow violently it moves, what it owes and what it pays you | 39 |
- Each factor except momentum is half fixed thresholds, half rank among the 48 Consumer Discretionary companies.
The financials
Revenue growth
Is the business growing? Yes
| Last 12 months | +15.3% |
|---|---|
| Over 5 years | +13.2% a year |
| FY2025 revenue | $717B (+12%) |
Free cash flow
Is it generating real cash? Less than its profits suggest
| FY2025 free cash flow | $7.7B |
|---|---|
| Of revenue | 1% |
| Of profit | 10% |
Profit margins
Is profitability improving? Yes, improving
| Gross margin | 51% |
|---|---|
| Operating margin | 13% |
| Net margin, FY24 → FY25 → now | 9.3% → 10.8% → 16.9% |
Debt vs. cash
Is the balance sheet healthy? Yes, more cash than debt
| Cash | $86.8B |
|---|---|
| Long-term debt | $65.6B |
| Net cash | $21.2B |
| Years to repay | 0.5 yrs |
Valuation
Is the stock price reasonable? Mixed: cheap on earnings, dear on cash
| P/E | 21.4× |
|---|---|
| Fair P/E for its growth | 36× |
| P/FCF | 375.1× |
| Forward P/E | 21.7× |
| EV / EBITDA | 16.3× |
At 21.4× earnings it trades well below the 36× that 19% a year of growth would justify. At 375.1× free cash flow it trades well above that same mark.
The financials, five years deep
Pulled from Amazon's XBRL filings on SEC EDGAR. Italic rows are worked out from the others.
| FY2025 | FY2024 | FY2023 | FY2022 | FY2021 | |
|---|---|---|---|---|---|
| Revenue growth | |||||
| Revenue | $717B | $638B | $575B | $514B | $470B |
| Change on the year | +12% | +11% | +12% | +9% | — |
| Free cash flow | |||||
| Free cash flow | $7.7B | $32.9B | $32.2B | −$16.9B | −$14.7B |
| Of revenue | 1% | 5% | 6% | −3% | −3% |
| Profit margins | |||||
| Operating margin | 11.2% | 10.8% | 6.4% | 2.4% | 5.3% |
| Net margin | 10.8% | 9.3% | 5.3% | −0.5% | 7.1% |
| Debt vs. cash | |||||
| Cash | $86.8B | $78.8B | $73.4B | $53.9B | $36.2B |
| Long-term debt | $65.6B | $52.6B | $58.3B | $67.2B | $48.7B |
| Net cash (debt) | $21.2B | $26.2B | $15.1B | −$13.3B | −$12.5B |
What Amazon says it does
This Annual Report on Form 10-K and the documents incorporated herein by reference contain forward-looking statements based on expectations, estimates, and projections as of the date of this filing. Actual results and outcomes may differ materially from those expressed in forward-looking statements. See Item 1A of Part I — “Risk Factors.” As used herein, “Amazon.com,” “we,” “our,” and similar terms include Amazon.com, Inc. and its subsidiaries, unless the context indicates otherwise. General We seek to be Earth’s most customer-centric company. We are guided by four principles: customer obsession rather than competitor focus, passion for invention, commitment to operational excellence, and long-term thinking. In each of our segments, we serve our primary customer sets, consisting of consumers, sellers, developers, enterprises, content creators, advertisers, and employees. We have organized our operations into three segments: North…
Risk factors AMZN lists in its 10-K
- Our Expansion into New Products, Services, Technologies, and Geographic Regions Subjects Us to Additional Risks
- Our International Operations Expose Us to a Number of Risks
- The Variability in Our Retail Business Places Increased Strain on Our Operations
- We Are Impacted by Fraudulent or Unlawful Activities of Sellers
- We Face Risks Related to Adequately Protecting Our Intellectual Property Rights and Being Accused of Infringing Intellectual Property Rights of Third Parties
- Our Expansion Places a Significant Strain on our Management, Operational, Financial, and Other Resources
- We Experience Significant Fluctuations in Our Operating Results and Growth Rate
- We Face Risks Related to Successfully Optimizing and Operating Our Fulfillment Network and Data Centers
- We Could Be Harmed by Data Loss or Other Security Incidents
- We Face Risks Related to System Interruption and Lack of Redundancy
- The Loss of Key Senior Management Personnel or the Failure to Hire and Retain Highly Skilled and Other Personnel Could Negatively Affect Our Business
- Our Supplier Relationships Subject Us to a Number of Risks
- Our Commercial Agreements, Strategic Alliances, and Other Business Relationships Expose Us to Risks
- Our Business Suffers When We Are Unsuccessful in Making, Integrating, and Maintaining Acquisitions and Investments
- We Are Subject to Payments-Related Risks
- We Have a Rapidly Evolving Business Model and Our Stock Price Is Highly Volatile
- Government Regulation Is Evolving and Unfavorable Changes Could Harm Our Business
- Claims, Litigation, Government Investigations, and Other Proceedings May Adversely Affect Our Business and Results of Operations
- We Are Subject to Product Liability Claims When People or Property Are Harmed by the Products We Sell or Manufacture
- We Face Additional Tax Liabilities and Collection Obligations
- We Are Subject to Risks Related to Government Contracts and Related Procurement Regulations